Commitments and Contingencies

12 Months Ended

Dec. 31, 2021

Commitments and Contingencies Disclosure [Abstract]

Included below is a discussion of various future commitments of the Company as of December 31, 2021. The commitments under these arrangements are not recorded in the accompanying Consolidated Balance Sheets. The amounts disclosed represent undiscounted cash flows on a gross basis and no inflation elements have been applied. As of December 31, 2021, the Company’s material off-balance sheet arrangements and transactions include $2.4 million in outstanding letters of credit issued under the Oasis Credit Facility and $6.7 million in net surety bond exposure issued as financial assurance on certain agreements.

Volume commitment agreements. As of December 31, 2021, the Company had certain agreements with an aggregate requirement to deliver, transport or purchase a minimum quantity of approximately 45.8 MMBbl of crude oil, 603.3 Bcf of natural gas and 22.5 MMBbl of NGLs, prior to any applicable volume credits, within specified timeframes, the majority of which are ten years or less.

The estimable future commitments under these volume commitment agreements as of December 31, 2021 are as follows:


	(In thousands)
2022	$	111,323
2023	108,006
2024	94,573
2025	85,986
2026	66,363
Thereafter	81,447
	$	547,698

The future commitments under certain agreements cannot be estimated and are therefore excluded from the table above as they are based on fixed differentials relative to a commodity index price under the agreements as compared to the differential relative to a commodity index price for the production month.

The Company enters into long-term contracts to provide production flow assurance in oversupplied basins and/or areas with limited infrastructure, which provides for optimization of transportation and processing costs. As properties are undergoing development activities, the Company may experience temporary delivery or transportation shortfalls until production volumes grow to meet or exceed the minimum volume commitments. The Company recognizes any monthly deficiency payments in the period in which the underdelivery takes place and the related liability has been incurred. The table above does not include any such deficiency payments that may be incurred under the Company’s physical delivery contracts, since it cannot be predicted with accuracy the amount and timing of any such penalties incurred.

In connection with the Williston Basin Acquisition, the Company acquired gathering and transportation contracts that include minimum volume commitments. The Company believes it is probable it will not be able to meet the minimum volume commitment in certain of these contracts and has recorded a liability of $11.9 million on the Consolidated Balance Sheet as of December 31, 2021, of which $5.5 million was recorded to accrued liabilities and $6.4 million was recorded to other liabilities. The future commitments related to these contracts are included in the table above.

Litigation. The Company is party to various legal and/or regulatory proceedings from time to time arising in the ordinary course of business. When the Company determines that a loss is probable of occurring and is reasonably estimable, the Company accrues an undiscounted liability for such contingencies based on its best estimate using information available at the time. The Company discloses contingencies where an adverse outcome may be material, or in the judgment of management, the matter should otherwise be disclosed.

Mandan, Hidatsa and Arikara Nation (“MHA Nation”) Title Dispute. This matter relates to certain leases acquired by the Company from QEP in October 2021: In June 2018, the MHA Nation notified QEP of its position that QEP has no valid lease covering certain minerals underlying the Missouri and Little Missouri Riverbeds on the Fort Berthold Reservation in North Dakota. The MHA Nation also passed a resolution purporting to rescind those portions of QEP's IMDA lease covering the disputed minerals underlying the Missouri River. QEP responded in September 2018 stating that the minerals underlying the Missouri River are properly leased. In May 2020, the Office of the Solicitor of the United States Department of the Interior (the “Department of the Interior”) issued an opinion (the “Missouri River Opinion”) finding that the State of North Dakota, not the MHA Nation, is the legal owner of the minerals underlying the Missouri River. The MHA Nation filed actions in two federal courts seeking to overturn the May 2020 decision, and in March 2021, the Department of the Interior withdrew the Missouri River Opinion and only recently, on February 4, 2022, the Department of the Interior issued a new opinion on the matter stating that the minerals beneath the Missouri River riverbed located on the Fort Berthold Indian Reservation belong to the MHA Nation and not the state of North Dakota.

Mirada litigation. As previously disclosed in the Company’s 2020 Annual Report, the Company entered the Mirada Settlement Agreement with Mirada on September 28, 2020. The Mirada Settlement Agreement provides for, among other things, payment by OPNA to Mirada of $42.8 million. The Company paid Mirada $20.0 million on the Emergence Date and $22.8 million in May 2021. These amounts were previously accrued for in the Company’s Consolidated Balance Sheet at December 31, 2020, and there are no remaining settlement payments outstanding as of December 31, 2021.